On 01/01/09 Roosevelt Company purchased 12% bonds having a maturity value of 500,000 for 537,907.40. the bonds provide the bondholders with a 10% yield. they are dated 01/01/09 and mature 01/01/14 with interest receivable December 31 of each year. Roosevelt company uses the effective interest method to allocate unamortized discount or premium.
a. prepare the journal entry at the date of the bond purchase
b. prepare the journal entry to record the interest received and the amortization for 2009.
c. prepare a bond amortization schedule